Nick Smith MP has warned that the full cost of the CAP Delivery Programme “IT disaster” has yet to be counted as farmers begin to receive their vital payments.

The Shadow Minister for Farming, Food and Rural Affairs challenged the Government at DEFRA questions yesterday over their mishandling of the scheme, which went £60m over budget and failed to work when needed.

A scathing NAO report highlighted an IT project held up as a “digital exemplar” that was marred by squabbling between top management and resulted in farmers being forced to switch back to paper-based applications.

Although George Eustice responded to Mr Smith’s questions by stating they have “worked very hard” to ensure the applications are entered on the core system and it has “worked well”, the NAO estimate as a result of the switch as many as 1 in 5 applications now have errors.

With disallowance penalties from the EU being incurred if payments are delayed, the NAO predicts the Government could be facing a hefty bill that exceeds the £44m (2%) yearly benchmark of the project “by some margin” -; indeed, coupled with Land Management System delays the NAO is projecting disallowance penalties of as much as 10%.

Speaking after the departmental questions, Mr Smith said farmers and taxpayers were counting on the Government to work tirelessly to fix a mistake twelve months in the making.

“I commend the work the Government have done to get 88,000 paper applications processed, but this never should have happened in the first place”, he said.

“This was supposed to be a £155m scheme to deal with £1.8bn of payments as efficiently as possible. Instead we had four leaders in twelve months and childish squabbles dooming the project to failure.

“Now with tough times in the dairy market and the fallout from the floods, farmers need their basic payments more than ever.

“We don’t want farms with cash flow problems at Christmas and we don’t want a bill from the EU stretching into the hundreds of millions.

“The Government needs to get a grip to avoid this becoming a disaster for us all”